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Friday, February 3, 2023

Bitcoin Litigation: Defendant Wins Over $ 50 Billion Bitcoin Dispute

NEW YORK. Craig Wright, a computer scientist who claims to be the inventor of Bitcoin, won a civil court judgment on Monday against the family of a deceased business partner who claimed to be owed half of his tens of billions of dollars worth of cryptocurrency fortune.

A Florida jury determined that Wright did not owe David Kleiman’s family half of the 1.1 million bitcoins. The jury did award $ 100 million in intellectual property rights to the joint venture between the two men, a small fraction of what Kleiman’s lawyers asked in court.

“It was a huge win for our side,” said Andres Rivero of Rivero Mestre LLP, lead attorney representing Wright.

David Clayman died in April 2013 at the age of 46. His family, led by his brother Ira Kleiman, claimed that David Kleiman and Wright were close friends and co-created Bitcoin as part of a partnership.

Ira Kleiman - Federal Courthouse In Miami
Ira Kleiman arrives at the Federal Courthouse in Miami November 17, 2021 (Martha Lavandier / AP Photo)

At the center of the test were 1.1 million bitcoins, worth about $ 50 billion at Monday prices. They were among the first bitcoins created through mining and could only have belonged to individuals or legal entities associated with the digital currency from the beginning – for example, the creator of bitcoins, Satoshi Nakamoto.

The crypto community will now be watching to see if Wright lives up to his promise to prove he owns bitcoin. This would confirm Wright’s claim, first made in 2016, that he is Nakamoto.

The Miami federal court case was eminently technical, with the jury listening to explanations for the complex workings of cryptocurrencies, as well as the vague origins of how Bitcoin came to be. It took the jury a full week to debate, repeatedly asking lawyers on both sides, as well as the judge, about how cryptocurrencies work as well as the business relationship between the two men. At some point, the jury made it clear to the judge that they were at an impasse.

Bitcoin’s origins have always been a mystery, which is why this test has received so much outside attention. In October 2008, in the midst of the financial crisis, a person or group of people named “Satoshi Nakamoto” published a document outlining the basics of a digital currency that would not be tied to any legal or sovereign authority. A few months later, the mining of currency began, in which computers solve mathematical equations.

The name Nakamoto, roughly translated from Japanese as “in the center”, has never been considered the real name of the creator of Bitcoin.

Wright’s claim that he is Nakamoto has been met with skepticism from a significant portion of the cryptocurrency community. Due to its structure, all Bitcoin transactions are public and the 1.1 million bitcoins in question have remained intact since their inception. Members of the Bitcoin community regularly urged Wright to move only a fraction of the coins to a separate account to prove ownership and show that he is indeed as rich as he claims.

During the trial, both Wright and other cryptocurrency experts testified under oath that Wright owned the bitcoin in question. Wright said he would prove his ownership if he wins the trial.

Lawyers for W&K Information Defense Research LLC, a joint venture between the two men, said they were “satisfied” that the jury awarded $ 100 million in intellectual property rights to the company that developed the software that laid the foundation for early blockchains and cryptocurrencies. technologies.

“Wright refused to give the Claymans their fair share of what [David Kleinman] helped create and instead took these assets for himself, ”Vel Friedman and Kyle Roche of Roche Freedman LLP and Andrew Brenner, partner of Boies Schiller Flexner, said in a joint statement.

Wright’s lawyers have repeatedly stated that David Kleiman and Wright were friends and collaborated to work together, but their partnership had nothing to do with the creation or early exploitation of Bitcoin.

Wright said he plans to donate most of the bitcoin fortune to charity if he wins the trial. In an interview, Wright’s lawyer Rivero confirmed Wright’s plans to donate most of his fortune in bitcoin.

Author: Ken Sweet

Associated Press

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